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cuts which is the true source of the deficit problem along with anemic economic growth. and here's one. we just got confirmation that the latest fiscal numbers from the treasury department show the federal government ran up more red ink in october than it did the year before, and guess what? spending went up double digits from the year before. what a surprise. but the white house got one thing right today. it released a study showing that a massive year-end tax hike would kill consumer spending by $200 billion, right. so let's not raise taxes. and in addition to all of this, the joint chiefs of staff is apparently drawing up plans to keep 10,000 u.s. troops in afghanistan past the 2014 deadline. this break a president obama promise, but some promises are made to be broken, and i think this is probably a good move. but first up congress back at work tonight after the holiday recess with now just 35 days to go. are we any closer to a tax and fiscal cliff fix? cnbc's own chief washington correspondent john harwood joins us now with all the details. good evening, john. >> reporter: good ev
there will also be a drag on the american economy if our budget deficit widens out forever, if we're irresponsible and governor doesn't work. left with those four choices, think think -- on the flip side, did republicans ask you to spend any nuts -- i think at this point both sides have acknowledged that there's going to be revenue concessions and entertainment concessions. in fact, if you listen to, it again, i'm not a master of the political art here, i'm in washington but i would say if you had these points of views in a business context, as close as they are, i would say a deal would be in reach. >> you see some fundamental level of optimism from lloyd blankfine but a long way to go with the combination of prief pressure and public pressure, like the president is going to exert before we actually go to the flight of fired. i asked the treasury secretary should the president return to wall street. he it must be someone who understands markets, marry. >> me have 33 days to -- head of all pi he told john harwood. marge i will hates have to go up somewhat. he said that's going to put a drag on the
should address the drivers of the deficit. social security is not currently a driver of the deficit. that's an economic pact. while the president supports engaging with congress on a separate tract to strengthen social security, for entitlements we need to look at medicare and medicaid. >> joining to us talk about that and more is alan krueger, chairman of the council of economic advisers. can you help us interpret what jay carney just said? a lot of republicans have gone into this debate and discussion saying, you want more in taxes but in the same time we have to have entitlement reform. is he taking that off the table, mr. krueger? >> the president has pursued a balanced approach all along. he's had entitlement reform on the table. if you look at budgets, there are tough decisions there relating to health care costs, which are driving our deficits. additional revenue from upper income earners. >> medicare is still on the table when it comes to discussions about the fiscal cliff but not social security? what exactly are we talking about? >> as jay carney said, social security is not a d
to hammer out a deal on the greek deficit. prime minister says they're cle. politicians are considering a debt forgiveness program but could see talso reaching agreement on a framework for the planned eurozone banking union. speaking to the ft, the eu internal markets commissioner said ministers must meet a december deadline in order to placate financial markets. and this as in spain voters in cat take loan i can't giving a victory to the separatist party, but the region's president lost ground. so what does it mean for the push for independence and the deficit reduction plans? julia is in barcelona for us. what does it all mean? >> it's being seen as broadly positive because it weekens his push for independence in the region right now. but the overriding message is that two thirds of the people that voted here voted for pro nationalist or separationist parties here. and this is a sentiment that's been growing over a number of years. and the president has to try to align himselves with other parties bearing two key facts, where does he take the push for a referendum, how does that influ
no problem. medicaid no problem. i don't know, one trillion deficit no problem. >> markets are falli ining dean. take a look. i don't understand this. attitude. i'm not hearing it from the president. no, first of all, interest rates are low because we have had a weak economy. as far as the debt goes, listen to dean, i'm sure that he believes that the only real problem phafacing the country a the capitol gains. i think we do have a debt problem i think we have a big debt problem. the numbers in the 20s, 30s, look horrifying and we have a huge job and growth problem. i don't understand how taking dividends from 15-43 creates jobs that closes that. >> i don't see spending cuts. it won't matter. the economy collapsed and the housing bubble collapsed. make them pay zero taxes. the search goes inside out. none of it finds that it will create any of those jobs. the government has no choice. >> that is quite an experiment. that you are willing to run with 1 or 2%. from 15 to 25. we are going to taking it from 15 to 30. >> we have been there. >> you are taking the rate on capital which we have the
, michelle, why is this such a crisis? we're going to have about $.5 trillion in deficits in 2013. is that a crisis? for god's sake, we're finally doing something to address our debt and deficits. that should be great news. i'll tell you why gold might be down today. why is the market rallying when gold, oil, and copper are down? the only tentity borrowing all this money is the government. that's why gold is going down. guess what? don't worry about it. they're going to punt on this like they have every other time. >> are you as pessimistic? are they going to punt? what do you do? >> in the short-term, you have to be careful. these are unknowable things. it's a very fluid situation, as you identified. somebody gives us some happy talk. this market goes straight up. i think gold is giving perhaps a false signal there won't be qe-4. i believe there will be. it's just a matter of time. this is going to take time to implement. we're not going to put all these changes in place january 1. there's no grand bargain out there that's going to cover all these things at once. it's going to be
. >> in the wake of the 2008 financial crisis, the size of the federal budget deficit has received a lot of attention. but state and local governments are also dealing with massive deficits. each state has a slightly different story, but across the country, there is a common theme. in many state houses, expenditures are outpacing income, and public pension obligations are drastically underfunded. as we reported in december 2010, some believe a day of reckoning is at hand for many states that could require another big bailout package. >> the most alarming thing about the state issue is the level of complacency. >> meredith whitney is one of the most respected financial analysts on wall street. she made her reputation by warning that the big banks were in big trouble long before the 2008 collapse. now she's warning about a financial meltdown in state and local governments. >> it has tentacles as wide as anything i've seen. i think, next to housing, this is the single most important issue in the united states and certainly the largest threat to the u.s. economy. >> why aren't people paying
? >> this is a question of what is optional. i sat back and watched my country grow a huge deficit while i accumulated money that was handed to me while i had tax increases that i didn't ask for. so i want to see my class step up and do what it has the capacity to do. >> you may have a chance who knows. thank you. >> casey mulligan, thank you very much. now let's go to grover, he has never been more prominent. here is my question for you. the republican ares are taking about tax hikes. it doesn't kill the country if we raise taxes a little bit on millionaires. that is bill crystal weekly standard. what is your take on the verbal time bomb? >> he focuses on other issues and has said before that he would leave the republican party and join the liberal hawks if the party was pro war in the past. i don't know how he gets plural on hawks. but the party is committed to low taxes and limited government and the people who aren't there can't call themselves republicans or conserve taticon. after this elicks grover, did people want to see common ground to deal with a fiscal cliff recession or trillion deficits
deficits close to 4% to 5% over the next decade and that's cbo forecasts. if that occurs, you're talk about the debt getting more and more out of control. because the u.s. is the global reserve council, it's reliant on global reserve investment. >> just want to make sure that people have enough treasuries to trade. that's all it's about, charles. isn't that very generous? >> it is very generous. but left unaddressed, the fiscal problem is beginning to be a problem. but equally they don't want the full hit at this stage. so it is a matter of coming to some compromise, so you are going to have to see some kind of adjustment on the taxation side. that is what everyone is hopeful for. but it's still a political game. >> and we've been burned before. let's recap in the meantime a couple of developments in europe overnight. the european commission is expected to approve the restructuring plans of spags's na -- spain's national lenders today. a token price of -- yes -- one euro. the valencia-based lank was one of four to be nationalized in the past 12 months. and hundreds of greek workers marched
in interest rates, $2.4 billion we take in. there's a $1.1 billion deficit. if that keeps up -- >> trillion. you're talking trillion-dollar deficits every year. >> if that keeps up, the spending goes to $6 billion. what we take in goes to $4.6 billion. you have a $1.4 billion deficit you're going to deal with in ten years with $1 trillion debt. interest payments you have to make every year. when you're making interest payments of $1 trillion a year, everybody is going to stop investing. germany isn't going to buy our bonds anymore. >> maybe they want this. it seems like both sides are digging in. the president says he wants $ .6 trillion in revenue. that means higher taxes as well as taking the loopholes away. maybe he wants to go over the cliff to prove a point. >> going over the cliff to prove a point is like wrecking your car to show that you can't drive. i mean, it doesn't make any sense. what makes sense is to be thoughtful. a democrats and a republican two years ago, simpson/bowles, got together and put together some guidelines that nobody paid any attention to. it had to do with heal
to these problems and a recognition that a balanced approach to deficit reduction is the right approach. it's the one most beneficial for our economy. >> reporter: the president's trying to take advantage of that different tone. he talked to speaker boehner over the weekend by telephone. and today you've had two business leaders, john engler, tom donahue, in to meet with senior white house officials. they're trying to keep this going. aides on capitol hill tell me no substantive progress in negotiations just yet. they're just now getting back to work after thanksgiving. >> how does that make you feel about the market? does it make you feel like they have more kum-bi-ya going on in washington, d.c.? does it make you more willing to invest? >> i'll tell you what. i saw spielberg's "lincoln" over the weekend and it was incredible because it reminded me how nothing has changed on capitol hill. >> i agree with you 150%. >> in 150 years. >> don't you get tired of everybody saying, oh, washington is a mess right now. it's never been this bad. it's always been this bad. you see that in the movie. >
. it almost makes me upset. interest rates are going down because they can't get a hands l on the deficit because stocks are going down. that's the reality we're dealing with. consumer confidence this morning, listen, i'm worried about the fiscal cliff. i have my button on. anybody who tries to put words in the general public's mouth about the fiscal cliff, these confidence numbers dispel that notion that they're worried. they probably don't even really know the details. >> david kudlow, you are taking something of a risk-on strategy. you're going with the high-growth, high-dividend plays in this market, aren't you? >> yeah, we are. it's a strategy that's worked quite well p the uncertainty we've had over the fiscal cliff. with the positive economic data coming in, high-growth areas have done well for us. hi areas have helped diversify and steady the portfolio. >> you're not worried about impact that the fiscal cliff could have on the tax treatment of dividends out there? you get all these companies imposing early dividends, special dividends to try and slip it in before the end of the ye
is that although it's running a primary deficit, actual servicing makes if worse. so one thing you can do is take away some of the debt burden to enable them to try to get the economy back into some sort of primary surface situation. but imagine we have a baby crawling across the floor and it keeps crawling away from us. we're picking up up the baby and bringing it back closer to us, but it's still crawling. so as soon as you put it down, it's heads off back where it came from. so the real problem with greece, they say the good news is we'll stay in the euro. really? the problem for greece is that greece in the euro appears to be uncompetitive. you either come out of the euro, and you have big significant drop in the value of your currency so everything that you do, no one would seem there is much change in import costs, but suddenly everything in greece is more than competitive. but if you stay, instead of the currency dropping 0%, every person's salary has dropped 30%. so this gets much, much harder. >> it's clear the internal devaluation is much more difficult, but also that it has been happen
, this debt and deficits of this country. the drama is playing out. how do you think it impacts the economy? >> first thing is i don't like what i see. i noticed that the politicians don't have their head in the game. they are like two teams playing to win. we're not represented by them. they are not coming to agreement to try to win points from each other. that's not what we want. >> it is all about winning. >> we are paying the price. these people are not paying the price. absence of the game is becoming the main source of fragility in american society and of course in the world economy. >> what do you mean by this? they aren't in the game. the john boehners and the barack obamas they don't have skin in the game. >> they are shooting for numbers to look good but they don't pay the price of the mistakes. you and i pay the price of their mistakes. >> let me bring up your book. the book is called "anti-fragile, things that gain from disorder" you said think of the economy as being more of a cat than a washing machine. >> let me explain about anti-fragile. the opposite of fragile is not robus
with an incredible deficit deduction in place. >> i plan to wake up with a big hangover. >> if we would go ahead with sequestration and increase in tax rates, they have to be happy. where is santelli on this? >> he does wear a pin, santelli. it's a good question. >> look, i just think that it is true that january may not be a debacle. as someone that cares about -- let's put my cards on the table. higher stock prices. we ain't going to go in that direction. it's not good for the stock market. >> we hear it all the time from business leaders. i heard it yesterday. head of north american m&a. if you get me a deal, i as ceo am going to make significant decisions that i'm not making now. >> there it is. it's the decisions. it's the decision to hire. decision to invest. it's a little dicey. you don't know what the world is going to look like. i think that the guy i care about may be more than the people meeting with president is jpmorgan head of m&a. these are few and far between. i spoke to ceo of pbh after interview he said i want to make money for shareholders taking advantage of the fact that int
the plan to a bankruptcy judge on friday. sa they need to close a nearly $46 billion budget deficit. new york and new jersey need at least $71.3 billion to recover from the devastation of super storm sandy and prevent similar damage from future storms. this is according to the state's latest estimates. that total of course could grow. steve liesman has been crunching the newspaperup i numbers and hn the next hour. this is to try to build up some sort of protection, some massive floodwalls. governor cuomo was saying this would be like $9.1 billion to start building. >> questions about the future of the sec following mary shapiro's exit. elyse walter could run the agent until december 2013 when she would have to be renominated and reapproved by the senate. among the issues, and ongoing battle over regulating the $2.5 trillion money market fund industry, some 63 unfinished rule making requirements that are all part of dodd-frank and continuing fears of course about market stability and high frequency trading. p. >> money markets used to be covered by the fdic when the crisis first came on.
and says the end for hp is not even sight. >>> also, japan has posted its worst trade deficit in october for more than three decades. exports dropped sharply amid territorial tensions between tokyo and beijing. it indicates the world's third biggest economy is inching closer to recession. this means the country would have seen its fifth technical recession in 15 years. at the same time, japan's opposition party promised a massive easing blitz meant to pull the economy out of its funk. that's if the ldp returns to power on december 16th. he promised to compile a large extra budget. he's also it rated calls to lift calls above the 1% target. >> translator: we should target inflation of 2% to 3%. i prefer 3%, but i will leave that up to the experts. i have never said the boj should directly buy bonds from the government. they should buy them from the market. >> his party is also considering the revision of the bank of japan law. yesterday the bank of japan chief hit back saying it was unrealistic. >>> just the latest in japan. let's get the market report kicked off by sixuan. >> let me star
. in other words, instead of a cliff, that you reduce the deficit over time in a much more orderly fashion. >> with a plan, though. >> with a plan. exactly. bowles simpson was a plan. >> bowles simpson is so far gone at this point. >> but when you look at those, they all have some come by neigh of spending cuts and tax increases. the idea is that over a period of time, you basically put the country in a better path, the government in a better path to spending and taxation. what you don't want is the fiscal cliff because that was designed to be something that nobody liked. and the reason is, yes, you've reduced the deficit from about 7% of gdp down to about 4% of gdp, so you move in the right direction really dramatically, but you do it in a way that nobody was happy with exactly where those cuts come from and exactly how the taxes increase. >> with what you're seeing, and we never know, it's almost like a mating dance where you've got the male and a feel of some species -- >> it's an ugly one. >> looks like they're never going to do it. they get closer and closer. >> but there is a lot of
, will congress be able to reach a fiscal cliff deal that really cuts spending and the deficit? wooohooo....hahaahahaha! oh...there you go. wooohooo....hahaahahaha! i'm gonna stand up to her! no you're not. i know. you know ronny folks who save hundreds of dollars switching to geico sure are happy. how happy are they jimmy? happier than a witch in a broom factory. get happy. get geico. fifteen minutes could save you fifteen percent or more. try running four.ning a restaurant is hard, fortunately we've got ink. it gives us 5x the rewards on our internet, phone charges and cable, plus at office supply stores. rewards we put right back into our business. this is the only thing we've ever wanted to do and ink helps us do it. make your mark with ink from chase. >>> another busy news day. markets higher right now. we had the cease fire now announced between israel and hamas. if there isn't peace in washington on avoiding a fiscal cliff, will these gains go away in a hurry? >> joining us now, rich bernstein, cnbc contributor, anthony chan, and our own bob posani. bob, so far we've seen, what, t
the revenue that gets us out of the deficit. >> a $4 trillion deal would be your goal. i want to focus on maybe something that hasn't been talked about as much, and that's entitlement reform. and the big one here would be medicaid and especially medicare. if you had to tell your democrat colleagues, here is the one reform that i think you should make to medicare, to reduce the growth and expenditure there, what would it be? would it be increasing the eligibility age? would it mean that the wealthy have to pay more? what would it be? >> there are any number of those things. you say to people at or near retirement, we're not going to change it for you. but for younger people, they want a change. they'll support it because we've got to make sure these entitlement programs are solvent both now and for the future. so i believe we can come together in a bipartisan way and do this. it's got to be part of a package in order to get the job done. >> i couldn't agree with you more on that because the history of american workers over the past 24 years is that we have adjusted to reduced benefits,
-- or betting there will be a huge issues in the coming years on these -- on the deficit issue, you may want to keep it off the table. >>> there's a third area there. i don't talk to anybody, steve or our guest, who doesn't think the u.s. can easily ramp up growth. the real discussion i don't think is the true u.s. economy. i thinkist the moguling being throw in front of it, our self-inflected issues, you know, last time around we sequestration. are we going to have sequestration 2? of course we'll put a band-aid, but we need leverage to have reform predicated to surrender on the band-aid. >>> we've got to go, guys. i've got to go with this. we've got to move on. this is the last hour of trading, so we've got to move here. thank you for your thoughts today. steve, thank you, you're voting on a committee of politicians. i find hope in that somehow. >> yeah. you're in the hopeful camp. >> hoping at the last moment they will do the right thing. >> was that a pig that just flew by? the market is slowly coming off the lows. >> instead the last time the markets closed in positive territory on blac
large deficits, as well. so the politics in spain slightly skewed as they will be, but not so much pressure on rajoy at the moment. unlikely to ask for assistance in the short term. we also have another euro group meeting take, back in brussels, yes, i know, we seem to have one every week. they may come up with a long term financing deal for greece. finally talking about debt forgiveness in greece which is what we all know has got to happen. whether it can happen before the german elections in the fall next year is a mute point. anyway, that's where we stand. fairly down beat for equities and yields a little bit mixed. back to you. >> all right. thank you very much. let's get back to the fiscal cliff. we've been talking about the issues of taxes. as we mentioned, warren buffett calling for a minimum tax for the wealthy. he starts with suppose that an investor you admire and trust comes to you with an investment idea. this is a good one, he says, i'm in it and i think you should be, too. would your reply possibility be it all depends on what my tax rate will be on the gain you're sa
of the issue. >>> in global market news, japan logging its fourth straight trade deficit in october. the european debt crisis with china over a territorial dispute actually reduced exports. and we continue to follow the latest developments out of the middle east. secretary of state hillary clinton traveled to the west bank this morning to meet with palestinian president mahmoud abbas. abbas heads the west bank, while the palestinian militant group hamas controls the gaza strip. hamas is considered a terrorist organization by the united states because it continues to refuse to recognize israel as a state. the united states has a policy of not negotiating with terrorist organizations. that's why she's not speaking with anyone in gaza. her visit comes hours after a meeting with israeli officials that lasted late into the night. >>> let's take a look at the markets this morning. we already showed you the futures. they are down slightly. dow futures down by about 23 points. in europe this morning, you'll see that -- also, by the way, a lot happened yesterday. ben bernanke started talking
those breaks could be chopped to cut the deficit. are those worries overblown? a heated debated is coming up. music is a universal language. but when i was in an accident... i was worried the health care system spoke a language all its own with unitedhealthcare, i got help that fit my life. information on my phone. connection to doctors who get where i'm from. and tools to estimate what my care may cost. so i never missed a beat. we're more than 78,000 people looking out for more than 70 million americans. that's health in numbers. unitedhealthcare. >>> let's get to mary thompson who has more on some of market action. >> more actually on all these companies paying out these dividends, michelle. consider this. last year only 44 members of the russell 3 o -- 3 000 had paid out a special dividend. why the rush? investors want to push out cash before the tax rates jump. take a look at these company names behind us. they're the one december clalar special dividends. on december 18th, a retail warehouse -- costco's payout, one of the ten largest out so far this quarter. in total, thos
% of the taxpayers and it's maybe $5 billion to $10 billion a year. relative to a $1 trillion deficit -- not saying it's nothing, but it's just such a tiny amount -- >> people at his income level are paying that. >> i have to say, if we're going to have a big tax debate, let's have one that really matters, now about this warren buffett rule which won't raise enough revenue to make a dime's worth of difference whether it comes to the federal budget. let's figure out what do we want to use our tax code for and what do we have to change to make it do that. >> let's move on to the next one which would put you in -- give you a real tax problem here. the powerball jackpot set for a record $425 million this wednesday. no winner over the weekend. what would you do with a half billion that came as a windfall to you? >> first thing i'd do, i'd give everybody i know a lot of money and say don't come back again. here you go. i'm going to seed all your brilliant ideas but that's all you get. second, i think i would look for -- a lot like peter thiel has done, look for underinvested ideas, writers, artists, tech
to talk about comprehensive tax reform and talk about spending cuts and talk about debt and deficit reduction. pulling out an isolated piece like raising rates or taking a mortgage interest deduction or whatever it may be, it doesn't serve a purpose. you have to look at the entire problem. if you don't do that, we're all dead. >> where does norquist fit in? has your own view on the pledge evolved? >> i'm not for increasing tax rates. i'm for reforming the code, raising the base upon which those rates might be applied. i'm not for raising the rates. >> why is this attracting a -- why is revenue in general attracting the share of the debate? i heard complaints that say we're not giving due attention to reform, to entitlements. is it just that taxes are sexy, is that it? >> if the media would stop asking about it we could talk about comprehensive reform of entitlements and of spending. it's a complicated, complex process. if you pull out one part of it and have a debate over that part, you're redirecting america's focus from where it ought to be which is comprehensive reform of spendin
Search Results 0 to 25 of about 26